FEATURED COMPANIES

This report is a comprehensive review of the coin market and exporting manufacturers .In it, we briefly examine the technology behind blank manufacturing and coin striking, before providing historical, technical and financial profiles of the main players in the industry. We conclude by considering the risks that are ever-present in this sector – the volatility of metal prices combined with high procurement costs and low margins – and the industry’s long-term prospects.

FEATURED COMPANIES

Our research has led us to construct a tiered segmentation for the coin industry.

The “first-tier” is dominated by large, state-owned mints that offer coins and blanks as well as a range of ancillary products, including commemoratives, bullion, decorations, medals and jewellery.

This is followed by a “second-tier”, composed of medium-sized state-owned mints without blanking capacity that caters to their domestic or regional needs, exporting excess capacity to the commercial market. The gap in turnover and volume between the first and second divisions is relatively wide.A “third-tier” is comprised of private-sector companies covering mint-related products and services. These include companies that offer minting components as a bi-product to their core business in industrial and consumer products.

We also observed that all state mints underwent “corporatization” around the 1960s-1990s, with governments instructing them to secure export sales. For example, The Royal Canadian Mint was converted in 1969, the Royal Mint in 1990, the Mint of Finland in 1993, the Royal Dutch Mint in 1994, the Royal Australian Mint in 1965 and the Slovakian Mint in 1968.

Another important finding relates to the conditions under which the industry must operate, namely risk. Elements of risk are linked to two key factors: the volatile price of metals, and the requirement to devote considerable financial resources for the acquisition of raw material for the manufacturing process. Groups that do not benefit from solid financial foundations can find themselves in difficulty if they overstretch their capacities. Some state-owned mints have the advantage of higher-margin revenues generated by sales to their own governments, sales that are closed to third parties, which in turn enables them to engage in global expansion. Others generate large turnover from bullion sales. For those that do not benefit from this added security, conditions can be challenging. For example, in 2011, we witnessed the quasi-bankruptcy of a notable European player, Verres SpA. As such, state-owned mints have a considerable advantage compared to private corporations, as they have a stableclient base in their national government. This is not doubt why many countries who buy coins only deal with those mints that are state-owned.

Finally, we found that in the period succeeding the launch of the Euro, mints that have consolidated into integrated manufacturing units, and which have established a sound financial base, are those best positioned to address the challenges of the market and grow in future.

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EUR 932USD 975GBP 682AUD 1,319JPY 121,273SEK 8 676CHF 977CAD 1,280

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